The Rise of India's Toy Industry: Initiatives, Innovations, and Market Developments

Indian toy Industry is fragmented and is largely unorganized as the market is very small compared to the population and per capita income. The organized players constitutes 10% of the total market share whereas unorganized players constitutes 90%.

The toy manufacturing industry is widely scattered in various parts of India, with more than 4000 industries in states like Uttar Pradesh, Maharashtra, Karnataka, and Tamil Nadu. The majority of toy manufacturing comes under the MSME sector which is widespread in the nation and nearby 88% of the manufacturing units are in northern and western India.

It is one of the highly populated countries in the world, and is witnessing rise in the population of children. Manufacturers are introducing various kinds of stuffed materials in the market to differentiate their product from competitors and offer some advantages over others such as introduction of soft toys made from bamboo, corn, wood, wool etc.

Initiatives Taken by the Government to Boost Toys Industry
Hiked import duty: The import duty on toys were raised from 20% to 60% 4 making it difficult for foreign companies to compete in our market as well as making Indian companies' entry into the market easier.

Handicraft and Gl Toys exempted from Quality Control Order: This allows any traditionally made toys by artisans registered with Development Commissioner (Handicrafts) to be exempted from the quality compliances newly introduced.

Custom Bonded Warehouse Scheme: Central Board of Indirect Taxes and Customs (CBIC) has launched anew scheme expected to play a critical role in promoting investments in India and in enhancing the ease of doing business. According to this, the unit can import goods (both inputs and capital goods) under a customs duty deferment program.

Export Promotion Capital Goods (EPCG) Scheme: Enables the import of capital goods (toys/ spare parts thereof) in the pre-production, production and post-production stage without the payment of customs duty.

PMP for Toys: The government is planning a PMP for toys with an aim to build a robust indigenous manufacturing ecosystem.

The Indian government introduced two key initiatives:

• In February 2020, the baseline customs tax was raised from 20% to 60% by the Indian government.
• Then, in January 2021, a year later, it issued a Toys Quality Control Order requiring all domestic and foreign toy producers to get a Bureau of Indian Standards (BIS) certification in order to sell toys in the Indian market. According to the requirements, all toys for children under the age of 14 must meet seven Indian quality criteria.
   

Demand in Domestic Market
According to Makreo Research, over the past few years, there have been quite a few new advancements in the toy sector in the nation, including the introduction of additional categories of toys that bring more innovation to better designs in the structure and numerous other areas. The domestic market has seen remarkable development & expansion in the toy business, which has been growing at a pace of 10-15% annually.

Key Developments

• Year 2020 saw the introduction of the National Toy Action Plan, which aims to increase domestic toy production in line with the "Make in India" initiative and increase market competition.
• In 2021, the India Toy Fair opened its doors, giving toy producers a venue to display their goods. Khilona 2023 is planned for August 18-20, 2023
• ClapJoy, a Delhi/NCR based toy manufacturing and marketing firm established in 2021, has raised funds through a 30% equity stake sale to enable expansion of its product portfolio and manufacturing capabilities.
• The first toy manufacturing cluster in India will be located in Koppal, in keeping with the PM's goal of promoting local production and toy manufacture. The 400-acre Special Economic Zone (SEZ) will have world-class infrastructure and create 40,000 employment in 5 years once the ecosystem needed to sustain the toy cluster is in place.

• Funskool
• Brainsmith
• Buddyz
• Clever Cubes
• Shinsei
• FunCorp.in
• The Story Merchants 
• Win Magic Toys
• Masoom Playmates
• Triple Ess Toys
• Khanna Toys
• Aditi Toys
• FunRide Toys
• Peacock Toys
• Skoodle
• Hamleys